The World Bank is set to consider three significant loan projects for Nigeria in 2025, totaling $1.65 billion. These projects aim to address pressing developmental issues in the areas of internal displacement, basic education, and nutrition enhancement.
Information obtained from the World Bank’s website indicates that the loans are part of efforts to support Nigeria’s recovery and reform agenda, particularly in sectors requiring urgent attention.
The first project, Solutions for the Internally Displaced and Host Communities, with a proposed commitment of $300 million, focuses on sustainable solutions for displaced persons and their host communities. This project is scheduled for approval on April 8, 2025.
The second project, HOPE for Quality Basic Education for All, is designed to improve access to quality education with a $553.8 million commitment. Approval for this project is anticipated by March 20, 2025.
The largest project, Accelerating Nutrition Results in Nigeria 2.0, is expected to receive $800 million, with a decision meeting slated for February 20, 2025.
These projects underscore the World Bank’s ongoing commitment to Nigeria’s reform initiatives and social development. However, securing the funds will depend on Nigeria’s ability to meet project requirements and demonstrate accountability during implementation.
Recent Loan Approvals and Commitments
Under President Bola Tinubu’s administration, Nigeria has secured loans amounting to $6.95 billion from the World Bank over the past 18 months. The latest addition to this figure is a $500 million loan approved on December 13, 2024, for the Rural Access and Agricultural Marketing Project-Scale Up. This initiative aims to improve rural connectivity to markets, schools, and hospitals, while promoting social cohesion in rural communities.
Other significant loans approved during Tinubu’s tenure include:
- $750 million: Power Sector Recovery Performance-Based Operation to stabilize Nigeria’s power sector.
- $500 million: Nigeria for Women Program, aimed at scaling up women’s empowerment initiatives.
- $700 million: Adolescent Girls Initiative for Learning and Empowerment, targeting educational opportunities for girls.
- $750 million: Distributed Access through Renewable Energy Scale-Up, providing renewable electricity access to 17.5 million Nigerians.
- $2.25 billion: Two packages approved in June 2024 to stabilize Nigeria’s economy and support vulnerable populations.
- $1.57 billion: Three projects approved in September 2024 for education, healthcare, and water management.
Nigeria’s Growing External Debt Burden
As of now, the World Bank holds a significant share of Nigeria’s external debt, with the International Development Association accounting for $16.32 billion (38% of total external debt) and the International Bank for Reconstruction and Development holding $484 million.
Nigeria’s external debt servicing cost reached $3.58 billion in the first nine months of 2024, a 39.77% increase from the $2.56 billion recorded in the same period in 2023. This surge reflects the growing fiscal pressure on the country amid economic challenges.
The global trend of rising interest rates has compounded debt servicing burdens for developing nations. The World Bank’s International Debt Report revealed that developing countries spent $1.4 trillion on foreign debt servicing in 2023, with interest payments alone accounting for $406 billion—a nearly 30% increase from the previous year.
For Nigeria, the approval and proper utilization of these loans could prove pivotal in addressing critical developmental needs and fostering economic stability.
